Saturday, November 14, 2009

An Illinois judge has decided that an anonymous commenter on a newspaper website will be unmasked, even though the mother of a teen about whom "Hipcheck16" allegedly made "deeply disturbing" comments hasn't yet decided whether to sue over the posting.

The mother, Lisa Stone, is a trustee of Buffalo Grove in suburban Chicago. The comments on the Daily Herald's website were made just before an April 7 election in which she won a seat, reports the Chicago Tribune.

Stone calls the posted comments about her 15-year-old son "deeply disturbing," but they aren't specifically described in the article.

Attorney Michael Furling, who represents Hipcheck16, says he will talk to his client about whether to appeal today's ruling by Cook County Circuit Judge Jeffrey Lawrence.

Although Lawrence ruled that Hipcheck16's identity must be revealed to Stone—and to a process server, should she decide to sue—he said it should remain confidential to others, according to the newspaper.

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Tuesday, November 10, 2009

Battle over wage-and-hour action against Hertz is all about location, location, location

a post by Marcia Coyle in The National Law Journal November 10, 2009

"The auto rental giant Hertz is incorporated in Delaware, has its headquarters in New Jersey and does its biggest volume of business in California. So where is Hertz's "principal place of business?"

The answer depends on which federal appellate court is asking the question. During the past 51 years, federal courts have used a hodgepodge of tests to determine a corporation's principal place of business. The U.S. Supreme Court today, for the first time, will consider what is the correct test in Hertz Corp. v. Friend, a case involving Hertz employees who claim the company violated California's wage-and-hour laws.

What the Supreme Court decides, in effect, will determine the battlefields on which class action and other litigation involving multistate corporations will be fought. Will it be what corporations perceive to be the friendlier forum of the federal courts or the plaintiff-sympathetic state courts?

Hertz, backed by such national business organizations as the U.S. Chamber of Commerce, is urging the justices to decide that a corporation's principal place of business for determining federal court jurisdiction is the corporation's headquarters. The "headquarters" approach offers a bright-line, certain and efficient way of determining a corporation's citizenship, according to Hertz high court counsel, Sri Srinivasan, a partner in the Washington office of O'Melveny & Myers. Under that approach, Hertz's principal place of business would be New Jersey and it could fight the wage-and-hour claims in federal court because, under the federal diversity jurisdiction statute, its New Jersey citizenship is different from the citizenship of the California employees suing it.

But that test ignores the realities of how multistate corporations do business, countered Robert Stein III, a partner in the Santa Ana, Calif., office of Adorno & Yoss, whose co-counsel, Todd Schneider of San Francisco's Schneider Wallace Cottrell Brayton Konecky, will argue for the Hertz employees.

Stein and his supporters argue that it makes more sense to look at whether any single state contains a substantial predominance of the corporation's business activity -- including facilities, employees and revenues. The 9th U.S. Circuit Court of Appeals took that approach in October 2008, decided Hertz's principal place of business was California, and sent the wage-and-hour lawsuit back to state court.

"It's very, very important for the Supreme Court to resolve this," said A. Benjamin Spencer of Washington and Lee University School of Law. "Today you can have a district court in New Jersey, knowing Hertz is headquartered there, that would be inclined to say New Jersey is Hertz's principal place of business. And, you have a district court in California saying it's California. Analytically, you can't have that. It can't be both."

BRAIN VERSUS BRAWN

Before 1958, the federal diversity statute said a corporation was only a citizen of its state of incorporation. But Congress found that some corporations engaging in local business were able to circumvent their local courts and get into federal court by getting out-of-state charters. Its evidence: more cases involving state-law claims and parties having the same citizenship were burdening the federal courts.

Congress amended the diversity statute to state that a corporation was a citizen of its state of incorporation and of the state where it had its "principal place of business." Congress wanted to reduce the federal courts' caseload and to preserve the original purpose of diversity jurisdiction, which was to protect true foreign corporations from the biases of local courts and juries. Congress believed a corporation was unlikely to face prejudice in a state where it had its principal place of business.

Congress, however, did not define principal place of business, and so the federal courts filled that void with varying and conflicting approaches.

The 5th, 6th, 8th, 10th and 11th circuits use a "total activity" test that examines the company's purposes, type of business and legal site of its operations. The 1st, 2nd and 4th circuits apply a variation of that test, and the 3rd Circuit looks for the "center of corporate activity." The 9th Circuit compares the states in which the corporation operates to determine where it has a "substantial predominance" of its operations.

The 7th Circuit is the only circuit that uses the "nerve center" test, explaining in one decision, "[W]e look for the corporation's brain, and ordinarily find it where the corporation has its headquarters." This circuit finds the location from which the company's chief executives control and direct activities at all other corporate sites."

Monday, November 9, 2009

Insurance -- Personal injury protection -- Explanation of benefits -- Circuit court appellate division departed from essential requirements of law in affirming county court judgment finding that an insured has a private cause of action against a PIP insurer who fails to provide its insured an itemized specification of each item the insurer has reduced, omitted, or declined to pay within 30 days after the insurer is furnished written notice of the fact of a covered loss and the amount -- There is neither a requirement nor a deadline for a PIP insurer to respond to a request for payment -- A response is required from the insurer only when insurer either pays a portion of a claim or rejects a claim -- Insured has no private right of action against insurer for insurer's failure to provide an explanation of benefits to insured or insured's assignee in timely manner -- Appeals -- Case falls within limited category of cases in which district court is authorized to exercise discretion to review a circuit court appellate division per curiam affirmance of county court order or judgmentReported at 34 Fla. L. Weekly D2268a

United Auto. Ins. Co. v. Santa Fe Medical Center ,(Fla.App. 3 Dist.)Insurance - Insurer was not required to obtain valid medical report before denying a PIP claim.The Florida District Court of Appeal has held that the subsection of the personal injury protection (PIP) statute providing that an insurer may not withdraw payment without the consent of the injured person, unless the insurer first obtains a valid report by another physician that the treatment was not reasonable, related, or necessary, does not require the insurer to obtain a valid medical report to deny payment of a PIP claim. Rather, this statute only requires that a valid report be obtained when further PIP benefits are withdrawn without the consent of the injured person. In so holding, the District Court of Appeal receded from United Auto. Ins. Co. v. Bermudez, to the extent that decision suggested that the medical report requirement applied to the denial of PIP benefits.

This decision may not yet be released for publication.

Insurance -- Coverage -- Waiver and estoppel -- Questions certified to Georgia Supreme Court: 1) Does an insurer effectively reserve its right to deny coverage if it informs the insured that it does “not see coverage,” after the insured had received a written reservation of rights from the insurer's sister company in a similar lawsuit in another jurisdiction, or is a written or more unequivocal reservation of rights required? 2) When an insurer assumes and conducts an initial defense without notifying the insured that it is doing so with a reservation of rights, is the insurer estopped from asserting the defense of noncoverage only if the insured can show prejudice, or is prejudice conclusively presumed? 3) If the insured must show prejudice, do the facts and circumstances of this case show it?Reported at 22 Fla. L. Weekly Fed. C233a

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I am a board certified appellate attorney and former chair of the Florida Appellate Practice Section. My firm concentrates on appeals and strategic trial support, to help businesses and individuals keep winning trial level judgments or get reversal of judgments against them. We are regularly asked to co-counsel with attorneys on complex appeals around the country, and admitted to and practice in the Florida and U.S. Supreme Courts, all federal Circuit Courts of Appeals , all Florida District Courts of Appeal, and the Southern and Middle Districts of Florida. When not doing law, I am a dedicated gourmet cook to my family and avid gardener, hiker, horseback rider, and consumer of murder mysteries.

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